Answer the following questions true (T) or false (F)
1. There will be no deadweight loss if the marginal benefit to consumers is equal to the marginal cost of production and the sum of consumer surplus and producer surplus is maximized.
2. If marginal benefit is less than marginal cost, output is inefficiently high.
3. The difference between consumer surplus and producer surplus in a market is equal to the deadweight loss.
1. TRUE
2. TRUE
3. FALSE
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The Bretton Woods system
a. fixed exchange rates in terms of U.S. dollars b. fixed exchange rates in terms of all major currencies c. fixed exchange rates in terms of gold d. established a system of flexible exchange rates e. established the European monetary system
As the ________ becomes larger, the distance between the line of absolute equality and the ________ becomes greater.
A. Gini coefficient; Lorenz curve B. Gini coefficient; production possibilities curve C. Income distribution size; Lorenz curve D. Lorenz curve; Gini curve
By convention, there are two major divisions of economics, called:
A. rational economics and irrational economics. B. marginal benefit and marginal cost. C. microeconomics and macroeconomics. D. reservation price and opportunity cost.
In Figure 20.1, total revenue is maximized at the unit price of
A. $100. B. $50. C. $80. D. $60.